The budget constraint
A)is the lower limit on a consumer's spending.
B)is the maximum utility an individual can achieve.
C)has to do with a consumer's willingness to spend.
D)expresses a consumer's preferences.
E)is the maximum a consumer can spend on goods and services.

Question

Quizplus · Accepted Answer

The budget constraint represents the maximum amount a consumer can spend on goods and services given their income and the prices of those goods and services. It is not a limit on a consumer's willingness to spend, nor does it express preferences or determine maximum utility.

The Budget Constraint